There is a £2bn shortfall in children’s social services.
Photograph: Jon Challicom/NSPCC/PA

Failure to support families at risk and reduce pressure on the care system will lead to child protection services becoming financially unsustainable, the chair of an expert care review group has warned.

Nigel Richardson, a former director of children’s services at Leeds city council, said that the struggle to cope with the rapid surge in children being taken into care at a time when budgets were shrinking could tip some councils into financial crisis.

Launching the Care Crisis Review on Wednesday, Richardson called on ministers to make up a £2bn shortfall in children’s social services and create a multi-million pound fund to give councils the breathing space to find ways of reducing pressure on the system.

The review was welcomed by the children’s commissioner for England, Anne Longfield, who called on ministers to prioritise preventative children’s services in the forthcoming government spending review.

Longfield said: “The huge pressures on the family courts, schools and the care systems we are seeing show this is not a sustainable way of funding children’s services. The cost to the state is ultimately greater than it should be, and the cost to those vulnerable children missing out on support can last a lifetime.”

There are fears in local government that child protection costs are in danger of spiralling out of control and are now potentially as much of a threat to council financial stability as elderly care costs. Last month Somerset county council, which has run up huge overspends on child protection, was told it was at risk of going bust.

The care crisis review outlines how local authorities are under huge media and political pressure to intervene in families, despite council budgets halving over the past seven years, and despite concern that in some cases the risk is not serious enough to justify children being taken from their parents.

Ray Jones, a professor and social work expert, said the rise in intervention reflected a switch in recent years away from the idea that the state should provide support to families to help them through stressful times, to one where the state intervened to protect them from failing parents. “Social values have now changed. We now blame people for their poverty.”

In May the children and family court advisory and support service (Cafcass) recorded 1,302 care applications, the second highest figure in its history, just behind the record 1,329 filed in June 2017. It costs about £35,000 a year to look after a child in care.

The review group, made up of senior judges, social workers, local authority officials and child welfare experts, warned of a crisis in the system, as well as unease over benefit cuts and rising poverty making it harder for families to cope.

The report found “frustration, despair and anger about the detrimental impact of poverty, cuts and austerity on the lives and life chances of vulnerable families”, and highlighted the link between rising poverty and demand for child welfare services.

It also warned that a “risk averse” culture in social services, coupled with cuts to family support programmes, meant officials were opting to seek court orders to take at-risk children into care, rather than working with families to resolve difficulties.

The report was endorsed by both the current president of the family courts division, Sir James Munby, and his successor, Sir Andrew McFarlane, who takes over next month. McFarlane said the courts and child welfare system was in crisis, fuelled by “untenable” workloads caused by rising care applications.

Richardson, who is credited with transforming Leeds council’s approach to vulnerable families, said councils should be allocated cash to enable them to develop ways of supporting at-risk families before they reached the point where they entered the care system. In Leeds, a £1m investment had safely reduced numbers of children going into care and saved the council £4m.

Failure to invest in effective ways of diverting families from expensive child protection intervention would overload the system and end up costing more money, Richardson said. “It does not make one jot of economic sense for us as a nation to spend money so unnecessarily.”

The Care Crisis Review, an independent study of the child welfare and family justice system in England and Wales, was funded by the Nuffield Foundation and the Family Rights Group charity.